Survey Points to Stuttering Eurozone Recovery

The economic recovery in the eurozone showed few signs of accelerating in October, a closely-watched survey of business managers indicated Thursday.

The monthly composite purchasing managers' index from financial information company Markit unexpectedly slipped in October to 51.5 points from September's 27-month high of 52.2.

Though it's still above the 50 threshold that indicates a rise in activity, the index, which collates information from both the manufacturing and services sectors, was below expectations. The consensus in the markets was for a modest rise to 52.4.

Chris Williamson, Markit's chief economist, said the dip is "clearly disappointing" but added that it would be "unwise to read too much" into one's month's data.

"More important is that the survey data have been running in positive territory for four consecutive months now," he said. "Although modest, the expansion is reassuringly broad-based across the region, reflecting signs of economic recoveries becoming more entrenched in the periphery as well as ongoing expansion in Germany and stabilization in France."

Economic data over recent weeks have supported that conclusion, suggesting the eurozone recovery has continued throughout the region in the latter part of the year but that growth isn't electric.

The economy of the 17 EU countries that use the euro grew by a quarterly rate of 0.3 percent in the second quarter, which brought an end to the single currency zone's longest-ever recession.

Figures next month are expected to show that the eurozone grew at a similar rate during the third quarter of the year.

James Ashley, senior economist at RBC Capital Markets, said the main message from Thursday's survey was that growth continues at a modest pace.

"For now, let's not quibble over whether that is shaping up to be a 0.2 percent pace or a 0.3 percent pace," he said.